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    Interest variations

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    Suppose $1,200 is invested into an account bearing 5.23% interest, compound monthly.

    Write an equation that will give the amount A in the account after t years.

    What would be the amount if compound daily, quarterly and continuously?

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    Solution Preview

    If the interest is compounded monthly, then the monthly rate = 0.0523/12=0.004358
    A(t) = 1200*(1+0.0523/12)^12t = ...

    Solution Summary

    Interest variations are demonstrated in this solution.